Capitol Alert

The latest on California politics and government

October 2, 2013
California's debt service level drops below projections

lockyer.jpgFour years ago, state Treasurer Bill Lockyer projected that servicing California's bonded indebtedness would approach 10 percent of the state's general fund revenues by 2014 and suggested that the state needed a master plan to prioritize its borrowing.

Since then, Lockyer says in his latest "debt affordability report," improving state finances, lower interest rates and tight management of new borrowing have reduced debt service to under 8 percent.

"In the market," Lockyer said, "the state's general obligation bonds have become more competitive with higher-rated bonds, and investors have reduced the interest-rate premium they demand to buy our bonds.

"At the same time, the state refinanced billions of dollars of bonds at lower interest rates and reduced taxpayers' debt service payments by hundreds of millions of dollars. In part because of these steps, debt service now consumes less of the state budget. The 2009 DAR projected debt service payments would equal 9.8 percent of general fund revenues in 2013-14. This report estimates that ratio will be 7.7 percent."

As of June 30, the state had $86.28 billion in general obligation and lease-revenue bonds supported by the general fund outstanding, plus another $36.54 billion authorized by the Legislature and/or voters but not yet issued.

In relative terms, California is a high-debt state, the report reveals. Among the 10 most populous states, California ranks second only to New York in debt compared to personal income (5.8 percent), debt per capita ($2,565) and debt compared to total economic output (4.98 percent). Texas is the lowest-debt state among the 10.

The state plans to issue $12.5 billion in new general obligation and lease-revenue bonds during the 2013-14 and 2014-15 fiscal years, including some of the $9.95 billion in bonds authorized for a bullet train system. Gov. Jerry Brown and legislators are also trying to write a new water bond issue for the 2014 ballot to replace an $11.1 billion measure now scheduled for a vote. The new water bond, if successful, is likely to be much smaller.

PHOTO: State Treasurer Bill Lockyer speaks at the Sacramento Press Club luncheon on June 21, 2012. The Sacramento Bee/Randy Pench.

July 5, 2013
Bill Lockyer opens 2018 campaign account to 'mete out justice'

lockyer.jpgState Treasurer Bill Lockyer has opened a campaign account for lieutenant governor in 2018, suggesting not a run for any seat but that Lockyer may remain involved in state politics as a campaign donor long after he retires from elected office in 2015.

The former attorney general and Senate president pro tem had accumulated more than $2.2 million for a campaign for controller next year before announcing last month he will retire when his term as treasurer ends.

Politicians often open campaign accounts for offices they do not intend to seek, using them solely to manage campaign stockpiles.

Lockyer spokesman Tom Dresslar said in an email today that Lockyer opened the account to "have a place to park his money for use beyond 2014."

"He wants to make sure he has the ability to support select candidates and causes, or as we like to say, mete out justice," Dresslar said.

PHOTO: Bill Lockyer in 2012. The Sacramento Bee/Randy Pench

April 2, 2013
Betty Yee's 2014 California controller campaign staffs up

BettyYee2010.jpgBoard of Equalization Member Betty Yee's campaign to become California's top bookkeeper is getting underway.

Yee has long planned to run to succeed state Controller John Chiang when he is termed out in 2014. The former California Department of Finance chief deputy director, who opened a committee to raise cash for the statewide run in 2011, filled the swag bags of delegates to the 2012 Democratic National Committee with a pen and pad promoting her run.

Today, she announced that SG&A Campaigns consultant Parke Skelton will run her campaign. Skelton, who also advises Chiang, said in a statement that the San Francisco native's Northern California base and connections to women and Asian Pacific Islander voters make her a strong candidate for statewide office. Nick Veach, a recent aide on Wisconsin Democrat Tammy Baldwin's successful U.S. Senate campaign, will lead fundraising efforts.

Yee could face competition from one of California's best known Democratic politicians. State Treasurer Bill Lockyer has more than $2.24 million in campaign cash set aside for a 2014 controller run.

September 5, 2012
Report: Nadia Lockyer faces drug, child endangerment charges

Nadia Lockyer, recently separated from state Treasurer Bill Lockyer, faces charges of felony methamphetamine possession and child abuse, the San Jose Mercury News reported today.

She was arrested last week in Orange County after officers found methamphetamine and drug paraphernalia at the house of a relative with whom she was staying with the Lockyers' 9-year-old son, Diego. Besides the felony methamphetamine charge, she faces misdemeanor charges of being under the influence of a controlled substance, possession of drug paraphernalia and child abuse and endangerment.

August 24, 2012
Bill Lockyer seeks AG's probe of bond agencies

State Treasurer Bill Lockyer has asked Attorney General Kamala Harris to probe conflict of interest allegations against two bond-issuing agencies after a state audit raised concerns.

Lockyer sought the audit a year ago, suggesting the California Statewide Communities Development Authority and the California Municipal Finance Authority operate with conflicts. The joint powers authorities serve as "conduit financiers" between hundreds of local public agencies and investors and make project financing decisions based upon recommendations from the private companies that serve as their staff. Lockyer has asserted that because the companies are paid based on the tax-exempt bonds issued by the authorities, they have an inherent conflict of interest.

State Auditor Elaine Howle, in a report released Thursday, did not go that far. She said the joint powers authorities have broken no laws, but suggested their mode of operation "raises concerns" that the practice violates the state Political Reform Act.

June 29, 2012
Bill Lockyer intrigued by vacancy atop California State system

RP BILL LOCKYER 4.JPGIf California Treasurer Bill Lockyer runs for public office again, in 2014, it will likely be for state controller.

But a more immediate opening may have piqued his curiosity.

Lockyer, 71, has privately expressed interest in potentially becoming chancellor of the California State University system, according to a source who is familiar with the search process but not authorized to speak publicly about it. It is unclear how serious the former state attorney general and longtime legislator is about the job.

Lockyer spokesman Tom Dresslar declined to comment beyond writing in an email Wednesday, "There's nothing to talk about."

Chancellor Charles Reed announced his retirement on May 24, and the CSU board's search committee has launched its efforts. The university system includes 23 universities and some 427,000 students.

A chancellorship would likely pay multiples of Lockyer's current salary, just more than $139,000. Last year, the CSU chancellor was paid $421,500, plus $30,000 from the CSU Foundation.

In December 2010, after being elected to his second term as treasurer, Lockyer opened a campaign account to run for state controller in 2014. At the time, Dresslar said, "If Lockyer decides to continue in public service after his term as treasurer expires, state controller is the office he is interested in seeking."

PHOTO CREDIT: Treasurer Bill Lockyer speaks to the Sacramento Press Club on June 21. The Sacramento Bee/Randy Pench

June 21, 2012
Bill Lockyer endorses tax measure, stays mum on scandal

State Treasurer Bill Lockyer said this afternoon that he will vote for Gov. Jerry Brown's November ballot initiative to raise taxes, despite concerns about the measure's burden on California's highest-income earners.

Lockyer, who said last year that California had neared its reasonable limit for taxing the rich, told the Sacramento Press Club that the alternative -- billions of dollars in spending reductions, including to education -- is intolerable.

"I'm voting for the governor's tax proposal," said Lockyer, a Democrat. "The cuts to education if it doesn't pass are so severe that it will injure our ability to produce an informed citizenry and workforce that we need for the future of California, so I'm a 'yes' vote."

Brown proposes to raise the state sales tax and income taxes on California's highest earners.

"I worry a little bit about fairness," Lockyer said, "although when you look at the income distributions in the last 20 years and see that essentially 80 percent of the people in California have either stagnated or fallen backward, 20 percent are the folks that actually have more disposable income, maybe progressive income taxes are relevant and fair in that kind of environment."

"However, you do get to the top pretty quick, and the potential for out-of-state migration is substantial enough that we have to be very sensitive about those rates," he added.

In a compromise to push a more popular, competing tax measure off the November ballot, the Democratic governor changed his tax initiative in March to include a larger tax increase on the wealthiest Californians than he initially wanted.

Lockyer said Brown had little choice but to alter his measure, adding, "I think he shares the same anxiety about practical impacts of our personal income tax getting high, or higher."

Lockyer's remarks came a day after Brown's tax measure and two others officially qualified for the November ballot. Lockyer said, "I reserve judgment" on the other two, one that would raise income taxes on all but the poorest Californians and one involving changes to the state's corporate tax formula.

Lockyer remained quiet about the scandal involving his wife, Nadia, who resigned from her position as an Alameda County supervisor after revelations of an affair and substance abuse.

The treasurer declined to discuss his wife's accusation he once supplied her with drugs, a claim Bill Lockyer's spokesman has previously denied.

"With respect to the personal matter, yes, I haven't commented much and don't intend to today," Bill Lockyer said.

The treasurer would at least allude to the matter later, however, provoking laughter while discussing rating agencies and California's creditworthiness.

"Have rating agencies in the past been probably too friendly with investors and Wall Street underwriters and others?" he said. "Yes, and whether people made money because of low ratings of some issuers? Yes, and was there sort of a co-dependent enabling going on -- sorry to start answering my last question, earlier -- but was there some of that going on with respect to the financial institutions? Yeah."

April 20, 2012
Nadia Lockyer to resign from Alameda supervisor post

Story updated at 4:50 p.m. based on statements provided to The Bee by state Treasurer Bill Lockyer and and Supervisor Nadia Lockyer.

California Treasurer Bill Lockyer's wife Nadia Lockyer , whose battles with substance abuse and an allegedly abusive affair became public earlier this year, announced today that she will resign from the Alameda County Board of Supervisors to focus on her family and her recovery.

The development was first reported by the Bay Area News Group, who interviewed Nadia Lockyer in her Hayward living room.

In a statement issued late Friday, Nadia Lockyer said she could no longer balance being a mother and county supervisor with her recovery from addiction and dealing with the "aftermath of interpersonal violence."

She cited both Mother's Day and National Crime Victims' Rights Week in her announcement. The California Department of Justice, where Bill Lockyer previously served as attorney general, is still investigating Nadia Lockyer's allegation that she was assaulted in February by her lover in a Newark hotel but has not filed charges.

"Today, for my child, and in the spirit of Mother's Day and National Victims Rights' Week, I hereby announce my resignation from the Alameda County Board of Supervisors, in order that I may focus on the well-being of my child, recovery from chemical dependence and interpersonal violence, and transitioning to work in the private sector," she stated.

Bill Lockyer issued his own statement later today: "I fully support Nadia's decision to step down as county supervisor and focus on completing her recovery and caring for our son. She has worked hard and well for her district. But the last year took a great toll on Nadia. It's best for her, best for Diego and best for our family that she leave public office."

Kevin Yamamura contributed to this report.

February 14, 2012
Wife of Treasurer Bill Lockyer enters rehab after assault

The wife of California Treasurer Bill Lockyer entered a rehabilitation program last week following an incident in which she was allegedly attacked by an ex-boyfriend at a Newark motel.

Nadia Lockyer, who serves on the Alameda County Board of Supervisors, said in a statement that she has enrolled herself in a "wellness and recovery center" to receive treatment for "chemical dependency," injuries from the assault and "chronic pain from a past debilitating car accident."

"Alcoholism and addiction are diseases from which many of us suffer, and unfortunately, I have not been spared," she said in the statement. "With the strong encouragement and support of the people in my life who love me, including my husband, my family, and my friends, I decided to get help and treatment so that I may fully heal and recover."

Bill Lockyer had earlier confirmed to the Chronicle that his wife had been "violently assaulted" Feb. 3 by a former boyfriend. Lockyer said he had been arguing with his wife on the phone before she met with the former boyfriend at the motel. He said at the time that he and his wife had recently reunited after a separation.

A spokesman for the treasurer said he is declining comment on today's statement.

Read Nadia Lockyer's full statement here.

The Chronicle, which first posted the statement, has more on the status of the investigation into the incident at this link.

February 12, 2012
Report: Bill Lockyer says wife assaulted by ex-boyfriend

State Treasurer Bill Lockyer told the San Francisco Chronicle that his wife, Alameda County Supervisor Nadia Lockyer, was assaulted by an ex-boyfriend at a Newark motel early this month, when she met with him after fighting with her husband, the newspaper reported this morning.

According to columnists Phillip Matier and Andrew Ross, Bill Lockyer said his wife believed her former boyfriend was in crisis, but that he was angry and "violently assaulted" her.

She was treated at a hospital and released, the columnists reported.

Read the full story here.

January 11, 2012
Moody's says California no longer has worst U.S. credit

We're No. 49!

After being stuck in the ratings basement since 2009, California's credit rating now ranks better than that of Illinois, according to Moody's Investors Service. Illinois was slapped with an A2 rating last week, worse than California's A1. Moody's penalized Illinois for unresolved pension liabilities and delayed payments.

"The downgrade of the state's long-term debt follows a legislative session in which the state took no steps to implement lasting solutions to its severe pension under-funding or to its chronic bill payment delays," Moody's wrote in its announcement. "Failure to address these challenges undermines near- to intermediate-term prospects for fiscal recovery."

California still ranks worst in the nation according to the two other major agencies, Standard & Poor's and Fitch Ratings. Though S&P kept California's rating at A- last year, it improved the state's outlook to "stable" from "negative" after the state enacted an on-time budget, cause enough for Gov. Jerry Brown to celebrate.

California starts this budget cycle facing a $9.2 billion deficit, $4.1 billion of which is because that June spending plan fell out of whack.

"It's not exactly cause to throw confetti from the top floor of our office here, but I think we can take heart from fact that California's credit standing in the market unquestionably has improved in the last year," said Tom Dresslar, spokesman for state Treasurer Bill Lockyer, of the climb out of the Moody's basement. "California cash borrowing notes received higher ratings last year, and all three of the major agencies have expressed more positive views about our credit worthiness."

September 30, 2011
California's debt share more than doubled since 2003

In a new report, Treasurer Bill Lockyer estimates California will devote 7.8 percent of its budget to paying off debt this fiscal year, more than twice the share in 2003-04.

Eight years ago, the state devoted 3.4 percent of its general fund to debt.

The spike in debt costs comes after California voters agreed to borrow more right before the state economy suffered a historic economic downturn, according to Lockyer's report.

Former Gov. Arnold Schwarzenegger and lawmakers championed a $37 billion public works bond package in 2006, near the height of the housing bubble in California when tax dollars flowed mightily into state coffers. Since 2004, voters also have approved borrowing for children's hospitals, stem-cell research and high-speed rail. The state is also paying off bonds that Schwarzenegger and lawmakers used to balance the budget in 2003-04.

State general fund revenues have dropped from $105.3 billion in 2006-07 to an estimated $87.2 billion in 2011-12. Borrowing cost the state $2.5 billion in 2003-04; this year, it will cost $6.8 billion.

Lockyer also attributed the debt service rise to the June 30 expiration of temporary tax hikes and a shift of sales taxes to local governments, both of which will reduce the amount of money available to the state general fund this fiscal year.

The state's debt share will actually rise higher in 2012-13 to 9.2 percent even without any new borrowing, according to Lockyer's report. That's because the state must pay back $1.9 billion next year that it borrowed to balance the budget in 2009.

Note: Borrowing cost figure for 2011-12 has been corrected.

September 7, 2011
California treasurer not thrilled with last-minute budget bill

As California prepares to ask investors for $5.4 billion next week, state Treasurer Bill Lockyer is none too pleased with a last-minute bill related to automatic budget cuts.

Lockyer had to amend his disclosure statement to explain that lawmakers may require Gov. Jerry Brown's administration to consult on alternatives to as much as $2.5 billion in "trigger" cuts under Assembly Bill X1 20. Brown and lawmakers agreed in June to prescribe cuts to schools and other public programs that would take place if the state falls behind its optimistic revenue projections.

Brown opposes the bill, and the Senate budget committee did not approve the measure Tuesday night in its first examination.

"We like the triggers fine just the way they are," said Lockyer spokesman Tom Dresslar. "We would have preferred that the Legislature not monkey around with them. The triggers were one of the strongest features of the budget. It's unfortunate there's a possibility they will be weakened."

Democratic lawmakers say the blowback is much ado about nothing. Sen. Mark Leno, D-San Francisco, chairman of the Senate budget committee, said before yesterday's hearing that the bill allows for better planning and more disclosure. He noted that lawmakers always have the power to change cuts mid-year, and this bill serves to underscore that point.

August 24, 2011
Bill Lockyer wins audit battle after a fight -- and a concession

It isn't often that a constitutional officer shows up at the Legislature's audit committee to pitch for an audit.

State Treasurer Bill Lockyer did just that today. He left with a narrow win, but only after agreeing to have one of the entities he controls subjected to similar scrutiny.

Lockyer and Assemblyman Mike Feuer, D-Los Angeles, pushed for state Auditor Elaine Howle to examine two bond-issuing joint powers authorities that they believe are operating with a conflict of interest and an unacceptably low level of transparency.

"There's been nothing but stonewalling from these particular JPA entities," said Lockyer, referring to the California Statewide Communities Development Authority and the California Municipal Finance Authority. "You kind of have to ask, why is so much energy going into 'don't look at us...'? My view is what we have is a private business operating as a public entity."

July 21, 2011
Lockyer to seek interim loan as hedge against federal default

State Treasurer Bill Lockyer will try to borrow about $5 billion for a brief period later this month to prepare for a possible federal "disruption," his office said Thursday.

Lockyer had originally planned to borrow the same amount of money later this year in order to ensure California has enough cash to pay its bills. But his office believes that absent a federal deal to raise the debt ceiling, the state could suffer from a "cash flow disruption and market turmoil" that would leave it unable to cover all operating costs.

To preempt such a problem, the treasurer will sell about $5 billion in short-term notes to private investors on July 26, using that money as a bridge to a separate $5 billion borrowing later this year. If federal officials reach a deal on the debt ceiling by July 26, Lockyer can avoid the bridge loan.

California borrows billions each fiscal year to pay its bills until the bulk of tax payments flow to the state in big collection months like April.

Lockyer relied on a $6.7 billion interim loan last October to help manage California's cash needs. In that deal, J.P. Morgan and Goldman Sachs accounted for nearly 70 percent of the funding, earning a 1.4 percent interest rate.

July 13, 2011
State revenues behind; Bill Lockyer skeptical about forecast

Gov. Jerry Brown's Department of Finance reported Wednesday that state revenues were $230 million behind fiscal-year expectations in the recently enacted budget.

That's a smaller amount than the $351 million gap that Controller John Chiang found after counting May and June revenues. The Controller's Office and Finance use different accounting methods.

Both reports show that revenues are running behind, however slightly, compared to the optimistic projections that lawmakers and Brown relied upon to close a remaining $9.6 billion deficit last month. Either way, the gap represents less than 2 percent of the $12.6 billion the state received in June.

June 28, 2011
Lockyer gives thumbs up to Democrats' budget deal

State Treasurer Bill Lockyer gave thumbs up today to the budget deal struck by Gov. Jerry Brown and legislative leaders.

Hours before the plan was set for a floor vote in the Assembly and Senate, Lockyer called it a "very important step forward in restoring California government to fiscal good health."

Unlike the budget proposal vetoed by Brown nearly two weeks ago, Lockyer characterized the new pact as "financeable," meaning fiscally viable and sufficient to borrow against.

"Our analysis indicates the plan reduces the need for external cash borrowing by as much as $2 billion, saving significant borrowing costs," Lockyer said in a letter to Brown, Assembly Speaker John A. Pérez and Senate President Pro Tem Darrell Steinberg, all Democrats.

"Perhaps more significantly, this budget, for the first time in recent years, honestly and clearly balances revenues and spending," the treasurer said of the plan, crafted by Democrats.

Lockyer also touted billions of dollars in budget cuts adopted earlier this year, saying the action "makes substantial progress toward eliminating California's large and chronic structural deficit."

Lockyer concluded his analysis by saying, "Many Californians will now confront hardships as a result of the very large cuts in vital services. I know these decisions were extremely painful for you to make.

"Nevertheless, today's budget plan represents a necessary and very important step forward in restoring California state government to fiscal good health."

The new proposal abandons the notion of temporarily extending higher sales and vehicle taxes as a "bridge" to a fall election. Its linchpin is a projection that the state will receive another $4 billion in extra revenue in 2011-12 based on strong tax receipts in May and June.

If revenue falls short, cuts will be triggered, including the possibility of a seven-day reduction in the school year.

June 16, 2011
Treasurer Bill Lockyer believes Dems' budget not financeable

Treasurer Bill Lockyer, a Democrat in charge of state financing, believes the just-vetoed Democratic budget would have prevented the state from borrowing enough money to pay its bills in the 2011-12 fiscal year.

Lockyer's assessment squares with Gov. Jerry Brown's determination that the Democratic majority-vote budget "is not financeable and therefore will not allow us to meet our obligations as they occur."

"Based on our preliminary analysis, the cash-flow borrowing need was $7 billion under the Democratic plan," said Lockyer spokesman Tom Dresslar. "The budget that was passed fell short in terms of providing adequate assurance we were going to have the wherewithal to repay $7 billion by the end of the fiscal year."

Dresslar added, "The Legislature's done a good job of getting us to this point, but there's still work that needs to be done."

Both the governor and the treasurer have now questioned the viability of the Democratic budget. The third leading state fiscal executive, Controller John Chiang, has not yet weighed in.

March 16, 2011
Coupal predicts 'fireworks' as he, Strickland tout spending cap

A group of Republicans today pushed for a stricter cap on state spending, with sponsors pledging to go to the ballot if lawmakers don't enact the change themselves.

Senate Constitutional Amendment 10, authored by Sen. Tony Strickland, R-Moorpark, would limit the rate of growth of state spending, allowing for annual increases to account for inflation and population growth. Supporters said excess revenues would be used to fill a reserve and school funds or be returned to taxpayers.

Strickland, who chairs the unofficial "Taxpayers Caucus" formed to oppose Gov. Jerry Brown's tax extension plan, said his proposal is the best fix for addressing a "spending problem of epic proportions" in California.

"We need to spend within our means just like every other California family,"he said at a morning press conference at the Capitol, adding: "The Legislature has an appetite for spending, and this measure will put them on a diet."

The office of Treasurer Bill Lockyer, a Democrat, called the proposal a political calculation that would not curb spending in the areas where it has grown at the highest rate over the past decade.

"Our position is, as a practical matter and given the political history, this kind of spending cap is going to wind up taking money for schools and giving it to health care and prisons," spokesman Tom Dresslar said. "Lockyer finds it hard to believe that anybody thinks that's good policy."

A long-term spending cap, generally opposed by Democratic lawmakers, is among the proposals advanced by a group of Senate Republicans engaged in budget negotiations with Brown, who needs at least two Republican votes in each house to put taxes on the ballot. A deal has yet to emerge, with floor votes on the budget scheduled to take place this afternoon.

Strickland's measure would require a two-thirds vote in the Legislature and voter approval to take effect. Howard Jarvis Taxpayers Association President Jon Coupal, said supporters are "under no delusions that this has got a tough road in the Legislature" and are looking at putting something similar on the 2012 ballot through the initiative process.

"That's where I think a lot of fireworks are going to happen with a number of proposals," said Coupal, whose organization is sponsoring the legislation. "If the governor really wants people to decide, I think the voters are going to have a lot of decisions in 2012."

January 22, 2011
Lockyer warns IOUs likely if budget talks fail

The state could begin issuing IOUs in April or May if Gov. Jerry Brown and the Legislature fail in their budget negotiations, state Treasurer Bill Lockyer said this afternoon.

IOUs could be required if the state is "unable to meet the self-imposed deadlines by the governor and the Legislature to adopt a budget in a timely way," he told academics and political consultants at a conference in Berkeley.

Brown is seeking to have a budget deal in place by March, proposing massive spending reductions and a ballot measure to extend temporary tax increases to resolve California's yawning budget deficit.

Lockyer said the "all-cut" alternative that could be required if voters do not extend tax increases is so awful Brown and Democratic lawmakers should make it public, despite not wanting to appear threatening to voters. He said state Sen. Mark Leno, D-San Francisco, is considering asking the nonpartisan Legislative Analyst's Office to issue such a document.

December 31, 2010
Schedule: Brown, constitutional officers to be sworn in Monday

By Torey Van Oot

All eyes will be on Gov.-elect Jerry Brown Monday as the 72-year-old Democrat is sworn in for a third term as California's chief executive.

That takes place at 11 a.m. at Sacramento's Memorial Auditorium. The Brown transition team has said an undetermined number of seats will be available to the public, but so far has provided no other details. A reception is scheduled for 4 p.m. at the California Railroad museum. Watch this blog for additional details as they become available.

Brown won't be the only constitutional officer taking the oath of office Monday. Here's a rundown of when, where and by whom the other statewide officials elected Nov. 2 will be sworn in.

Controller John Chiang

Time: Approximately 9:30 a.m.
Place: Elks Tower Ballroom, 921 11th St., Sacramento
Officiating: Sacramento Superior Court Judge Russell L. Hom will administer the oath of office.
Reception: Chiang's ceremony will kick off with a private reception at 8 a.m. sponsored by the Grace Initiative, a new nonprofit effort focused on providing financial literacy programs for low-income working families.

Superintendent of Public Instruction Tom Torlakson

Time: 9 a.m.
Place: The gymnasium of Concord's Mount Diablo High School, where Torlakson taught before beginning his career in politics.
Officiating: Torlakson will be sworn in by Barbara Nemko, Napa County schools superintendent.
Reception: Torlakson will head to Sacramento to host an open house at the California Department of Education, 1430 N St., from 3 to 5 p.m.

Attorney General Kamala Harris

Time: 1 p.m.
Place: The swearing in will be private, at the California Museum For History, Women & The Arts, 1020 O St., Sacramento.
Officiating: To be determined.
Reception: A private reception will follow at the museum.

Treasurer Bill Lockyer

Time: 3 p.m.
Place: Capitol Rotunda
Officiating: Lockyer's wife, Alameda County Supervisor Nadia Lockyer, will administer the oath of office. Former Democratic Sen. Art Torres will emcee the event.
Reception: Lockyer hosts a private reception following the ceremony at the state Treasurer's Office.

Insurance Commissioner Dave Jones

Time: 5 p.m.
Place: Tsakopoulos Library Galleria, 828 I St., Sacramento
Special guests: Controller John Chiang, a longtime friend and high school classmate, will emcee the ceremony. California Supreme Court Chief Justice Tani Cantil-Sakauye will administer the oath of office.
Reception: A public reception follows the ceremony, lasting until 6:30 p.m.


Secretary of State Debra Bowen

Time: 10 a.m.
Place: Secretary of State Office Building Auditorium, 1500 11th St.
Officiating: Attorney General Kamala Harris will administer the oath of office.
DELAY: Bowen's staff said the elections chief opted to wait a day to be sworn in for her second term because of the already crowded schedule on Jan. 3.


Lt. Gov.-elect Gavin Newsom will be in Sacramento to attend the swearing-in ceremonies for Gov.-elect Jerry Brown and other constitutional officers, but the San Franciscan won't take the oath of office himself.

Newsom has scheduled an inaugural celebration for 1 p.m. on Jan. 10 in the Capitol Rotunda, though a spokesman said he could be sworn in sooner.

Constitutional officers are eligible to be sworn in as soon as the first Monday in January following the November election, though the term will not technically start until they take the oath of office.

Newsom's decision is a political one, albeit local. By holding off on resigning as San Francisco mayor, Newsom will ensure the newly elected San Francisco Board of Supervisors, a more moderate bunch than the current board, selects the interim mayor to fill the remainder of his term there.

Lt. Gov. Abel Maldonado, the Republican Newsom defeated in the November election, is eligible to remain lieutenant governor until Newsom takes the oath of office.

December 6, 2010
Is Lockyer for controller 2014 on the horizon?

HA_lockyer.JPGFresh off his re-election to a second and final term as the state's chief banker, state Treasurer Bill Lockyer has opened a campaign account to run for state controller in 2014.

It isn't unusual for elected officials to open new campaign accounts to stash their campaign cash -- and add to the reserves -- after Election Day ends. Lockyer has an especially ample war chest -- more than $5 million going into the final weeks of his landslide re-election campaign.

But is the long-time Democratic state lawmaker, attorney general and treasurer -- who would be 73 at election time in 2014 -- looking to add yet another constitutional office to his resume?

"If Lockyer decides to continue in public service after his term as treasurer expires, state controller is the office he is interested in seeking," spokesman Tom Dresslar said.

PHOTO CREDIT: State Treasurer Bill Lockyer. Hector Amezcua, Sacramento Bee.

August 4, 2010
Lockyer spends big to boost wife's supervisor run

HA_bill_lockyer_II(2).JPGMore than half of the $1 million in campaign funds State Treasurer Bill Lockyer spent during the first six months of the year went toward a tough primary fight.

But Lockyer, who faces Republican Sen. Mimi Walters in the November election, wasn't challenged in the June primary -- his wife was.

Lockyer dipped into his multi-million dollar campaign war chest to contribute more than $545,000 to his wife Nadia Lockyer's Alameda County Board of Supervisors campaign in the first six months of 2010, according to his campaign finance report filed this week. That comes on top of another $75,000 he gave her campaign in 2009.

He also reported spending more than $17,000 between January and June on "in-kind" contributions to his wife's campaign, footing the bill for research, printing costs and consultants.

The cash appears to have helped. Nadia Lockyer was the top vote-getter in the four-way primary, but not by a large enough margin to avoid a November run-off. She'll face former state Sen. Liz Figueroa, who happens to be Bill Lockyer's former flame, in the run-off.

PHOTO CREDIT: State Treasurer Bill Lockyer tells a legislative committee on Friday, May 22, 2009, that lawmakers should rely heavily on spending cuts to balance the budget. Sacramento Bee/ Hector Amezcua

July 14, 2010
Lockyer expresses concerns about high-speed rail financing

HA_lockyer_II.JPGState Treasurer Bill Lockyer is warning that investors' concerns that the proposed high-speed rail project will "never work economically" could hurt progress on plans to build the bullet train connecting Los Angeles to San Francisco.

Lockyer said questions from Wall Street investors have made him "reticent to try to go to market to issue bonds to finance the state's share."

Voters approved $9.95 billion in bonds in 2008 to fund the project. The state has also been awarded $2.25 billion in federal funding, but Lockyer said securing the additional private funding to construct the project could prove difficult until questions about its viability are answered.

Here's what Lockyer told the editorial board of the San Diego Union-Tribune:

"There are segments of the line that you could run sensibly, principally L.A. to San Diego," the treasurer said. "I hear from the world of Wall Street investment bankers about what they think makes sense. And almost universally, they're convinced that no one can finance the routes from L.A. to the Bay Area, that it just will never work economically, certainly in the foreseeable future."

Rail authority officials "need to do a lot more work to make sure investors can be reassured of the financial viability of the project," Lockyer said. "There are dozens if not hundreds of infrastructure investment funds on the planet. (The California Public Employees' Retirement System), as an example, recently bought a significant piece of a London airport. There are a lot of infrastructure funds like that that are public and private, probably trillions of dollars looking for good deals. So there's financing potentially available if it's a good deal. I'm just not yet convinced the investors are going to think that's a smart investment to make."

Click here for the full editorial.

PHOTO CREDIT: State Treasurer Bill Lockyer testifies before a legislative committee on May 22, 2009. Hector Amezcua / Sacramento Bee file photo

February 23, 2010
Can Danny Glover save NUMMI from closing its doors?

Actor Danny Glover has played a hero on the big screen, but can he save the soon-to-be shuttered NUMMI plant from its impending closure?

State Treasurer Bill Lockyer hopes so.

Glover is one of ten Californians Lockyer has tapped to serve on a new labor-funded commission tasked with studying the potential fiscal impact of the New United Motor Manufacturing Inc. Plant's March 31 closure.

The creation of the commission comes as community leaders, organized labor and local and state officials press Toyota to keep the Fremont assembly plant open. The plant employs nearly 5,000 workers, though the Treasurer's Office estimated in a release that the closure could result in 50,000 lost jobs from companies across the state that supply parts for the plant.

The panel will submit to Lockyer a report outlining options for keeping the plant open and potentially travel to Japan to deliver its findings to Toyota executives. The commission's work and travel expenses will be funded by labor groups, Lockyer spokesman Tom Dresslar said.

"The primary goal is to convince Toyota of the wisdom of reversing course," Dresslar said. "(Lockyer) lives in the community, and he thinks that it's important that we do everything we can to keep that plant open and protect those jobs."

The commission, which also includes local officials and representatives from business, labor and environmental groups, will meet tomorrow to establish a timeline for completing its work. The public hearing will be held at 10 a.m. at the California Public Utilities Commission's San Francisco office.

See the full commission roster after the jump.

April 25, 2009
Lockyer on the top 10 'movie remakes for our tough times'

Treasurer Bill Lockyer has a long history of delivering Top 10 lists in convention speeches, and 2009 is no different.

Below is the link to the PowerPoint of Lockyer's list this year.

Biggest applause line: Bernie Madoff in "Swindler's List.

Lockyer Top 10.ppt

March 2, 2009
Lockyer: Budget vote 'antes will only keep going up'

State Treasurer Bill Lockyer voiced a fear that many Democrats hold privately -- that the high price paid to corral the final GOP vote for the budget could set a poor precedent for future negotiations.

"Frankly, I think this is just the beginning of serious budget holdups in the future," Lockyer, a Democrat and former Senate leader, told Greg Lucas of California's Capitol. "If you're willing to rewrite the constitution to get a needed vote, the antes will only keep going up.

That's a reference to deciding Republican vote, Sen. Abel Maldonado, who received a constitutional amendment on a future ballot to rewrite the state's elections law.

Lockyer, the state's banker, also spoke about the state's bond rating. California has the lowest such rating in the nation, which he blames, in part, on Wall Street.

"The fact is our rating is the lowest of all the states. It's not fair but it's the rating we've got. I've argued with the rating agencies on that but they claim their ratings are being responsive to investors," he said. "If they're being responsive to investors then they want us to have a bad rating so the investors get a better yield. They're helping rip us off, in effect."

January 16, 2009
AM Alert: First to Durst

PooledBoard.jpgThe speech is done. The reactions are in. And the state still faces a looming cash crisis and a enormous deficit over the next year-and-a-half.

(But, if you have a minute, check out Bee photographer Brian Baer's photo gallery of the speech.)

Today, state Controller John Chiang will outline how he will prioritize spending come February, when California is expected to be unable to pay all its bills.

Later, the obscure State Pooled Money Investment Board will meet to consider loosening the freeze it placed on $3.8 billion worth of infrastructure project financing in December.

The board, which is composed of Chiang, state Treasurer Bill Lockyer and Gov. Arnold Schwarzenegger's Finance Director Mike Genest, voted to cut off funding to conserve money on Dec. 17.

Meanwhile, the California Alliance for Jobs, a group that promotes construction projects in the state, hit the radio on Thursday with ads blasting the Legislature for failing to pass a budget fix.

Comedian Will Durst is the voice of the ads. The meat of one spot:

Get this; the State is about to stop funding hundreds of infrastructure projects - roads, schools, and levee repairs we desperately need. And that would put hundreds of thousands of people out of work. Nice Job guys. Your endless rhetoric over the budget gives new meaning to "blowing in the wind". We need real negotiations and real compromise - a budget that balances major cuts AND revenue increases. . .and we need it now.

And that's the gentler spot. In the other, Durst accuses lawmakers of "digging our financial grave."

Finally, a familiar face was in the Capitol on Thursday to hear Schwarzenegger's big speech: ex-Gov. Gray Davis, no stranger to mammoth budget shortfalls.

"It's deja vu," Davis told reporters after the speech, according to AP. "California has experienced feast-or-famine budgeting as long as I can recall, and (it) will go on for all eternity until the people pass a genuine rainy day fund."

Ok, seriously Gray, did you use the verb "recall" on purpose?

Photo: State Treasurer Bill Lockyer, center, Finance Director Mike Genest, left, and Controller John Chiang, right, -- the three members of the usually obscure Pooled Money Investment Board -- on December 17, 2008. Credit: Renee Byer/Sacramento Bee

January 12, 2009
Garamendi, Brown, and Lockyer won't furlough workers

Three of the Democratic statewide officials have now said they will not abide by Gov. Arnold Schwarzenegger's executive order to furlough state workers twice a month.

Attorney General Jerry Brown will implement "alternative measures" to cut costs, according to a memo obtained by the State Worker blog.

State Treasurer Bill Lockyer told the Schwarzenegger administration in a letter Friday that he won't furlough his staff.

"We believe that the governor has not established that he has the legal authority to impose furloughs and the related salary cuts on state employees," Lockyer wrote.

Lt. Gov. John Garamendi said in a statement today that he, too, won't furlough his staff.

"We have already cut the lieutenant governor's budget by 10 percent this year and we will cut another 10 percent this year. We are public servants for the people of California so we will not be furloughing our staff," Garamendi said in a prepared statement.

The offices of state's constitutional officers (Brown, Lockyer, Garamendi, state Controller John Chiang, Insurance Commissioner Steve Poizner, Secretary of State Debra Bowen and Superintendent of Public Instruction Jack O'Connell) do not fall under the governor's authority to force furloughs.

December 17, 2008
AM Alert: Moving the budget ball?

The Assembly's budget session on the Democrats' latest budget proposal lasted into the night Tuesday.

Republicans, as they have throughout the year, blocked passage, standing firm in their opposition to any new taxes to solve Califronia's nearly $40 billion deficit through July 2010.

No one seemed too surprised. Partisan tensions ran high during much of the debate.

The state Senate takes its budgetary turn this evening, with a 5 p.m. floor session.

Plans are afoot in the upper house, led by Senate President Pro Tem Darrell Steinberg, to craft a majority-vote package that could pass without GOP support.

Meanwhile, today the Pooled Money Investment Board will vote to suspend financing of infrastructure projects across California.

State Treasurer Bill Lockyer has released a detailed list of infrastructure projects that would be affected.

The board -- composed of Lockyer, Finance Director Mike Genest and Controller John Chiang -- meets at 10 a.m.

At 1 p.m., Gov. Arnold Schwarzenegger will return to the site of one of his signature events of the recall campaign -- the California State Railroad Museum.

Schwarzenegger will tout the passage of Proposition 11, the redistricting measure, and promise more political reforms going forward.

Open primaries anyone?

The railroad museum location is all about symbolism, as the state's pioneering political reformer Gov. Hirman Johnson led a series of reforms to curb the influence of railroad barons.

Five years and three months ago, Schwarzenegger declared there that in Sacramento, "the contributions go in, the favors go out, and the people are punished with wasteful spending and high taxes."

He promised a fundraising ban during while negotiating the budget, overhauling redistricting, better open records laws, and to veto any bill that didn't receive a full public hearing.

After the success of the Proposition 11 campaign, Schwarzenegger seems destined to continue to use the Legislature as his foil for political reform.

You know, creating things like a ticking deficit clock.

December 16, 2008
Lockyer details vulnerable projects

State Treasurer Bill Lockyer has released a detailed list of infrastructure projects that are at risk if the Pooled Money Investment Board votes Wednesday to suspend financing because of the Legislature's inability to close the state budget gap.

Lockyer said the move is necessary so the state can conserve cash as revenues lag and the political deadlock continues. The state is unable to sell bonds to replenish the pooled money fund.

The board -- Lockyer, Finance Director Mike Genest and Controller John Chiang -- meets at 10 a.m. to take up the matter.

The list can be viewed here.

December 8, 2008
AM Alert: No budget, no infrastructure projects

AssemblyChambers.jpgThe entire state Legislature will meet today in a "joint convention" to get even more dire news about California's woeful financial situation.

Treasurer Bill Lockyer, for instance, will tell lawmakers that unless a budget is adopted the state will stop financing construction projects for roads and other infrastructure. That's not just bond sales for future projects -- those will stop, too. It means projects that are underway will no longer be able to draw down cash from the treasurer's pooled account as the state's general fund moves toward insolvency. Thousands of jobs could be lost.

"No budget, no state financing," said Lockyer spokesman Tom Dresslar. "The spigot is completely off. We're talking about a complete shut-off of state infrastructure financing unless we get a budget fast."

Lockyer, Controller John Chiang, Department of Finance Director Mike Genest and Legislative Analyst Mac Taylor will describe the consequences of failing to reach a budget compromise.

The state faces an estimated $27.8 billion deficit over the next year and a half.

Barring moves by the Legislature, Gov. Arnold Schwarzenegger said in a letter to state lawmakers last week that, "The state will experience a cash-flow crisis beginning in February or March."

After the lame-duck Legislature failed to reach a budget accord, Schwarzenegger called for a special session of the new Legislature to address the state's "fiscal emergency." The new members -- including 25 "true freshmen" -- were sworn in only a week ago.

Outside of the annual State of the State address or speeches by visiting dignitaries (such as the presidents of Mexico and Spain, in 2003 and 2001, respectively) - joint sessions are rare for California.

"There have been presentations by heads of state and distinguished policy experts but in those instances they were sharing their expertise with the Legislature," said Dotson Wilson, the Assembly's chief clerk and parliamentarian.

"This particular joint convention is much more interactive," Wilson added.

The format of the joint convention -- which is set to begin at 3 p.m. -- allows all 120 lawmakers to ask questions of those testifying before the Legislature.

"All the members are on the floor discussing a policy," said Wilson.

Also, late Friday Senate President Pro Tem Darrell Steinberg named the membership and chairmanships of the upper house's five budget subcommittees. See who they are.

Photo: The Assembly Chambers in Nov. 2008. Credit: Brian Baer/Sacramento Bee.

November 3, 2008
Members of the class of 2010 stake out their positions (or not)

GavinNewsomNoon8.jpgCorrection: The original version of this story said that state Treasurer Bill Lockyer had declined to take a position on the three law-and-order ballot measures on the Nov. 4 ballot. That is not true. He was opposed to Proposition 5, as we reported here.

In Capitol Alert's survey of potential 2010 candidates for governor, several interesting facts emerged.

Among them:

The state's former top cop has declined to take a position on two of the three law-and-order measures on the ballot. The closer a candidate is to being a frontrunner the less likely he or she was to take a stand on anything. And not much separates the Democrats who participated - they largely agreed on the issues.

November 3, 2008
Where the 2010 candidates stand

Thumbnail image for StevePoizner2.jpgCapitol Alert set out to get all the potential candidates for governor of California in 2010 to declare their positions on the 2008 statewide ballot measures..

Not surprisingly, some politicians were more accommodating than others.

All told, we surveyed eleven political figures whose names are floating as potential 2010 candidates (three Republicans and eight Democrats).

They range from Lt. John Garamendi, who has already announced his candidacy, to Los Angeles Mayor Antonio Villaraigosa, who still faces reelection and has said he does not want to run.

Thumbnail image for JohnGaramendi.jpgFour of our list of candidates chose not to participate: Former eBay CEO Meg Whitman, Insurance Commissioner Steve Poizner, Attorney General Jerry Brown and Sen. Dianne Feinstein. The positions we report below are the stands they had previously taken publicly.

Read our analysis of some of the most interesting findings among the would-be governors' positions.

October 29, 2008
Lockyer becomes first statewide Dem to back Proposition 11

LockyerSchwarzenegger.jpgState Treasurer Bill Lockyer became the first statewide elected Democrat to endorse Proposition 11 on Wednesday, saying through an aide that the power for state lawmakers to draw their own districts "presents an untenable conflict of interest."

Lockyer provided his positions on the Nov. 4 ballot measures at the request of Capitol Alert.

Tom Dresslar, a Lockyer spokesman, said the state treasurer, former attorney general and former state lawmaker believes that "the current redistricting system is not the cause of all evil in Sacramento and Prop. 11 is far from the cure all for everything that ails state government."

"That said," Dresslar continued, "allowing the Legislature to set its own district boundaries presents an untenable conflict of interest, and on that principle he supports Prop. 11."

Opponents of Proposition 11, led by Senate President Pro Tem Don Perata, D-Oakland, have argued that the measure is a Republican power grab. (Except when they tell Republicans it is a Democratic power grab).

GOP Gov. Arnold Schwarzenegger is supporting the remapping plan, is the measure's largest donor and has tapped his vast fundraising network to pass the proposition.

October 29, 2008
Lockyer, Feinstein oppose lottery bond plans

State Treasurer Bill Lockyer said he would join Sen Dianne Feinstein in opposing Gov. Arnold Schwarzenegger's lottery proposal, which still must be approved by voters.

So says Joel Fox, president of the Small Business Action Committee, at Fox and Hounds Daily.

Borrowing against future lottery earnings is expected to plug a $5 billion hole in next year's budget, but passage of the plan is far from a sure thing.


Capitol Alert Staff

Jeremy White Jeremy B. White covers California politics and edits Capitol Alert's mobile Insider Edition. Twitter: @capitolalert

Amy Chance Amy Chance is political editor for The Sacramento Bee. Twitter: @Amy_Chance

Dan Smith Dan Smith is Capitol bureau chief for The Sacramento Bee.

Christopher Cadelago Christopher Cadelago covers California politics and health care. Twitter: @ccadelago

Micaela Massimino Micaela Massimino edits Capitol Alert.

Laurel Rosenhall Laurel Rosenhall covers the Legislature, the lobbying community and higher education. Twitter: @LaurelRosenhall

David Siders David Siders covers the Brown administration. Twitter: @davidsiders

Dan Walters Dan Walters is a columnist for The Sacramento Bee. Twitter: @WaltersBee

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